Several members of the POU domain gene family have been shown to be important in tissue specific gene regulation during development. We have cloned two DNA's encoding two unique Xenopus laevis POU-domain proteins, XLPOU 1 and XLPOU 2, of the POU III protein class. Both genes are expressed as early as the neutral plate-neurula stage in embryos. In adults, XLPOU 1 expression is restricted to the skin and brain, while XLPOU 2 expression is observed in kidney and brain. In dissected embryos, both XLPOU 1 and XLPOU 2 are expressed in the dorsoanterior portion of the early tailbud embryo. Consistent with this localization, UV treatment, a condition that "posteriorizes" embryos, greatly reduces the expression of XLPOU 1 and XLPOU 2. In situ hybridization studies show that XLPOU 1 transcripts are localized in the anterior region of the neutral plate and nerve cord. In tailbud staged embryos, the XLPOU 1 transcripts are localized mostly in the brain and eye. There is a sharp anterior boundary of expression; the most anterior region of the brain does not hybridize. The posterior boundary of expression, apparent in tailbud stage embryos, is at the junction of the hind-brain and spinal cord. We believe that XLPOU 1 and XLPOU 2, because of their localized and early expression in embryos may play an important role in the specification of neuronal phenotypes.